A Study On The Influence Of Institutional Factors On The Reverse Technology Spillovers Of OFDI In China

Since the reform and opening up, China has been implementing the strategy of "bringing in" and promoting the improvement of our economy by attracting foreign investment. With the development of our economy, our country is not satisfied with playing a low role of the global value chain, so we put forward the strategy of "going out". In recent years, China’s labor cost advantage has lost, and the western developed countries also put forward the "re-industrialization" strategy. In this background, our China is urgent to restructure the economy, from the factor driven economy to innovation driven economy, and the demand for the upgrading of technology is becoming increasingly urgent. Through foreign direct investment to obtain the reverse technology spillover has become an important tool for the enterprises in our country to improve their technology quickly.There are lots of researches on the reverse technology spillover of foreign direct investment, mainly from the perspective of the developed countries to study the existence and the influencing factors of the reverse technology spillover of foreign direct investment. The study of foreign direct investment reverse technology spillover in our country starts late, and the achievement is less than that of foreign country, and the study of the influence of home country institutional environment for foreign direct investment reverse technology spillover is still a blank area.This paper introduces the research background of reverse technological spillover of OFDI and the existing research results, and analyzes institutional of our country and the mechanism of reverse technology spillover from the perspective of new institutional economics. Besides, this paper analyzes the influence of five institutional factors from the perspective of economic and legal institution. Then, the paper makes a qualitative analysis of the changes of our country’s institutional and the development of foreign direct investment, and figures and charts are used to describe them. Finally, five institutional factors are used as independent variables, and the invention patents authorization is used as dependent variable to establish the model of the relationship between institutional environment and OFDI reverse technology spillover, and use the provincial panel data of 2003-2013 in China to study the east, middle and west respectively.The results show that:from the perspective of the whole country, all the five institutional factors, including the degree of market, policy openness, education support, technology support and intellectual property protection have a significant positive impact on the OFDI reverse technology spillover, that is, a good institutional environment has a significant effect on the OFDI reverse technology spillover. In addition, there are significant regional differences in the impact of institutional environment on OFDI, five institutional variables in the eastern region all have a significant positive impact on OFDI reverse technology spillover, education support, technology support and intellectual property protection have a significant positive impact on the OFDI reverse technology spillover, while the degree of market and policy openness have no significant impact. In the middle, only education support has a significant impact on the OFDI reverse technology spillover, while all the other four institutional variables have no significant effect. Accordingly, this paper put forward the following suggestions:increase of private enterprise support, improve China’s foreign direct investment policies, promote the perfection of China’s foreign direct investment intermediaries, promote the marketization process, increase support to education, science and technology, strengthening the protection of intellectual property rights, increase in the central and western the policy tilt.